Spurred by changing customer behaviour, shipping consolidation services allow companies to ship more frequently in smaller batches and at cost effective rates. If this sounds appealing, it should, and here’s why it could be the right choice for you.
Fulfilment demands speed, and when your products don’t add up to a full trailer or container, you need a shipping solution that fills the need without eating into your bottom line. This is where consolidated shipping services make the most sense and keep your deliveries moving forward.
What are Shipping Consolidation Services?
Shipping consolidation services are processes that combine multiple orders together into single consigned shipments. This allows smaller companies to take advantage of bulk transportation rates, save time and conserve resources.
Based on the LTL (Less Than Truckload) and LCL (Less Than Container Load) shipping models, shipping consolidation services use fewer vehicles to transport freight. This is ideal for businesses that make small, frequent shipments as there is less products handling which reduces the risk of damage and claims.
An Example of Shipping Consolidation
Order consolidation can be a combination of a single company’s products or multiple shipper’s products. For example, let’s assume a shipper located in Etobicoke Ontario has multiple shipments of sports apparel going to a variety of retailers in Edmonton Alberta. Before sending it to their regional distribution centre, they usually wait until a full truckload accumulates. Once the load is full, it goes directly to Edmonton for delivery.
Now let’s say a shipper doesn’t have enough packages to fill the entire truckload but needs to ship what they have to meet delivery requirements. If we consolidate the shipment with another local shipper’s products going in the same direction that will fill the container, we have a win-win situation through combined efficiency.
As long as the various shipments fall within compatible freight classes, and fill an entire trailer from floor to ceiling, carriers help shippers create a more cost-effective streamlined supply chain. Rather than “shipping air” with multiple half-filled trailers, bundling orders presents multiple benefits to both shippers and consumers.
Types of Shipping Consolidation
Retailers in particular are always seeking innovative, cost-efficient ways to ship their products. In response, due primarily to escalating adoption of e-commerce, the methods surrounding consolidation of freight and unification of orders are gaining more attention due to evolving buying patterns of both consumers and suppliers who each expect speedy delivery times.
Larger cargo shipments of dry or temperature controlled goods require careful logistics planning to combine less than truckload (LTL) and less than container load (LCL) freight into full shipments. An experienced 3PL provider will utilize contacts throughout their networks to ensure on time in full (OTIF) delivery via waterway, rail, air or truck.
As one of the major North American economic drivers, automotive consolidation requires next-level supply chain expertise to fulfil deliveries in the transportation sector. With a heavy reliance on just-in-time manufacturing, combining multiple orders from automotive suppliers into single shipments is key to cost-effective operations for automotive manufacturing plants, distribution centres and retail locations.
In retail, consolidation warehousing plays a primary role in being able to hold product under ideal conditions. Through strategically located warehouses and distribution centres, retail-direct and pre-paid supplier programs help combine orders from multiple suppliers into a single shipment deliveries for retailers.
Forwarding and Distribution
If you need to ensure the quality of your goods due to restrictive shelf-life limitations, transportation time becomes that much more critical. In such cases, storage and staging of products is kept as close as possible to final destinations, picked and packed to order so goods arrive on time.
Cross-Border Consolidation Shipping & Logistics
One of the ways shipping consolidation helps customers reduce their freight expense is through consolidated cross-border programs. For instance, a partial or a full load in the US is delivered to courier and LTL networks in Canada.
Instead of paying for multiple international truckloads or LTL freight & courier shipments, customers enjoy reduced costs via Canadian domestic LTL, line-haul and courier transportation. This reduces multiple customs entries to one consolidated Canadian customs entry which can significantly save on annual customs brokerage fees.
6 Benefits of Using Shipping Consolidation
The benefits of consolidated shipping can be significant. Industry experts are providing in-depth and creative strategies customized to both shippers and their customers’ specific needs.
When done correctly, consolidated freight services provide a winning balance for retailers, courier companies, and end customers. Depending on schedule, volume and hold time, players involved in the order fulfillment process benefit in the following ways:
1. Reduced Shipping Costs
Consolidated shipping allows you to reduce the amount of packaging materials and use fewer boxes. This reduces both the dimensional weight and the actual weight of your shipments, plus it reduces wasted trailer space. Order consolidation also helps to reduce handling fees per package, further reducing shipping costs.
2. Increased Supply Chain Consistency
Through monitoring shipping patterns such as common pool points and recurring orders, you can increase delivery optimization. Knowing which orders are coming in each day, as well as which ones are ready for pick up allows you to implement predictive actions. Along with the aid of transparent order tracking and tracing throughout the supply chain, you’re better able to meet each customer’s deadline and run a smoother production schedule.
3. Less Risk of Damage
When a truckload or container is full, there’s less likelihood of packages shifting dangerously and incurring damage due to excess unused space. When shipments are consolidated, each item will also require less handling which again lowers the risk of damage.
4. Improved Consumer Experience
When orders are consolidated, retailers and suppliers get to take advantage of optimized supply chain efficiencies. The net effect results in customers receiving their orders more quickly, safely and of course at reduced cost.
5. Enhanced Quality Control
Consolidated shipping services enable your operations to detect order or product problems before they leave the warehouse by putting quality control measures in place before your goods are sent out.
6. Added Sustainability and Emissions Controls
Consolidated freight shipping means you can use less packaging materials: boxes, foam peanuts, tape and such, thus helping to reduce waste and its environmental impact. Additionally, better cube utilization on trucks results in more units shipped in fewer cartons. Vehicles require less fuel to ship more products thereby reducing carbon emissions in the environment.
With initiatives such as the SmartWay program, logistics providers are helping reduce the number of diesel emissions being released into the atmosphere.
Is Order Consolidation the Right Strategy for Your Business?
Consolidated shipping can help you improve associated costs on carrier rates, dimensional pricing rules, handling fees, or other shipping expenses such as customs fees and duties.
As an experienced logistics partner for multiple national brand names, Brimich Logistics and Packaging can help streamline your whole shipping process through multiple tools and touch points. From providing automatically generated shipping labels and customs paperwork, to automated shipping rules, along with branded tracking and packing slips to help with your order consolidation needs.
With the right combination of tools, consolidated shipping services help build customer confidence by offering a more positive shopping experience with lower shipping costs.